At COP 7, decision 14/CP.7 was adopted on the impact of single projects on emissions in the
commitment period. According to this decision, any Annex I Party, which accounts for less than 0.05
per cent of the total Annex I Parties emissions in 1990, can exclude from its national total
emissions during the commitment period, the emissions from single projects provided that renewable
energy is used, resulting in a reduction in greenhouse gas emissions per unit of production, and best
environmental practice is used to minimize process emissions. Decision 14/CP.7 required any Party
wishing to avail itself of these provisions to provide a notification to this effect before COP 8. At
COP 8 (New Delhi, October/November 2002) it was noted that two notifications had been received: one
from Iceland and one from Monaco.

Background

The problems associated with the impact of single projects on emissions in the commitment period were
first raised by the delegation of Iceland during the negotiations on the Kyoto Protocol. Iceland
expressed concern that, for Parties with very low emissions baselines, a single project (e.g.
construction of an aluminium smelter) could lead to a disproportionate percentage increase in
emissions. Iceland's concerns were reflected through paragraph 5(d) of decision 1/CP.3 adopted at
COP 3 (Kyoto, December 1997), which called for this issue to be further considered at COP 4 (Buenos
Aires, November 1998).

At COP 4, Iceland proposed a
draft decision on the impact of single projects. According to this proposal, single projects that
have a significant proportional impact on emissions in the commitment period should be reported
separately, and not included in national totals, to the extent that they would cause a Party to
exceed its assigned amount. The proposal explicitly limited this provision to:

Parties that account for less than 0.05% of total Annex I emissions in 1990;

Single projects involving industrial processes that account for more than 5% of the total
greenhouse gas emissions of a Party in 1990;

Single projects where renewable energy is used, resulting in a reduction in greenhouse gas
emissions per unit of production; and

Single projects where best environmental practice is used to minimize process emissions.

A number of Parties requested additional information and clarifications on Iceland's proposal.
These requests, and responses provided by Iceland, have been compiled in miscellaneous documents (see
below).

Discussions on the impact of single projects took place during COP 4 and at subsequent SBSTA
sessions. After informal consultations held at SBSTA 13 part I (Lyon, September 2000), Parties agreed
to consider the issue further at SBSTA 13 part II (meeting together with COP 6 in The Hague, November
2000).

Following discussions at SBSTA 13 part II, Parties forwarded a draft decision to COP 6 for further
consideration, based on a revised proposal presented by Iceland. This revised draft decision
stipulated that the total industrial process CO2 emissions that a Party may exempt from
its national totals under the proposed provision shall not exceed a cap of 1.6 million tonnes
annually on average over the first commitment period. Another revision was made following
consultations during COP 6, further specifying that the exempt emissions may not be transferred or
acquired through emissions trading or "joint implementation" projects.

However, consensus could not be reached on the revised draft decision and, together with draft texts
on other issues, it was referred to a resumed session of COP 6. At COP 6 part II (Bonn, July 2000),
Parties completed their work on this issue, reaching agreement on the revised draft decision,
including the proposed cap of 1.6 million tonnes and the prohibition on the use of exempt emissions
to participate in emissions trading or "joint implementation". The completed decision was
forwarded to COP 7 (Marrakesh, October/November 2001) where it was adopted (decision
14/CP.7).

Key Decisions

Decision 14/CP.7
Impact of single projects on emissions in the commitment period (decision 16/CP.4) (see
FCCC/CP/2001/13/Add.1, section II) more >>

Decision 16/CP.4
Impact of single projects on emissions in the commitment period more >>